China has filed a complaint with the World Trade Organization (WTO) over India’s subsidies for electric vehicles (EVs) and battery manufacturing.

A spokesman of China’s Ministry of Commerce confirmed that the country had formally submitted a consultation request over India’s subsidies for the EV and battery sectors.

The spokesman claimed that the subsidies could be violating multiple obligations, including ‘national treatment,’ which are expressly prohibited by the WTO.

Under WTO rules, the national treatment obligation is a general prohibition on the use of internal taxes and other internal regulatory measures that are meant to protect domestic production.

“These measures give Indian industries an unfair competitive advantage and harm China’s interests. China will take resolute measures to effectively safeguard the legitimate rights and interests of its domestic industries,” the spokesman said.

China has urged India to abide by its WTO commitments and immediately correct its ‘erroneous’ practices.

Last September, India launched the PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) Program, and the PM-eBus Sewa-Payment Security Mechanism (PSM) Program.’ The PM E-DRIVE Program, with a total outlay of ₹109 billion (~$1.29 billion), focuses on providing demand incentives, deploying electric vehicles (EVs), and developing charging infrastructure to support wider EV adoption. The PSM Program, with an outlay of ₹34.35 billion ($409 million), supports the procurement and operation of over 38,000 electric buses from FY 2024-25 to FY 2028-29.

The Indian govenment provides capital subsidies for battery energy storage systems (BESS) under multiple programs.

The Ministry of Power offers a viability gap funding (VGF) of ₹1.8 million (~$21,043)/MWh to support the development of 30 GWh of BESS capacity under the second tranche.

The Union Cabinet had initially approved a VGF program to add at least 4,000 MWh of BESS by 2028 by providing ₹37.6 billion (~$433.84 million) in capital subsidy. As battery costs fell, the government told Parliament in March 2025 that the same capital subsidy could now cover about 13,200 MWh.

The production Linked Incentive program, with a total outlay of ₹181 billion (~$2.47 billion), aims to implement advanced chemistry cell manufacturing facilities. As of 2025, 40 GWh has been allocated to four beneficiaries across two tranches. The remaining 10 GWh has been explicitly earmarked for grid-scale stationary storage applications.